Energy-GDP-exports nexus and energy conservation: evidence from Pakistan and South Asia.

An important principle enshrined in the Colombo Declaration of the Fifth Summit Conference of the Non-Aligned nations (August 1976) was the reiteration of the need for economic cooperation among developing countries. The resolution on the Seven-Point Plan called for the creation of a confident spirit of collective self-reliance which included the willingness to pursue the possibilities of cooperation among themselves in financial, trade, industrial and other fields. 1 Economic cooperation among developing countries has increased considerably during the last decade and it continues to be further strengthened and broadened in the various activities covered, especially, at the sub-regional level. In South-East Asia, the Association of South-East Asian Nations (ASEAN) has made a remarkable break-through in the field of trade liberalisation, industrial collaboration, food security, energy and transport. 2 The ASEAN experience can serve as a good example for the formation of other mutual sub-regional groups in the Economic and Social Commission for Asia and Pacific (ESCAP) countries. The increasing interest in the sub-regional economic cooperation is reflected in the initiation that emerged in South Asia in the early 1980's. The regional groups or sub-groups facilitate easy accessibility to each other's market and substantial diversification of the type of goods which they can exchange and hence increase the share of foreign trade in national income. According to a report published by the United Nations Conference on Trade and Development (UNCTAD), it is observed that in the 1960's trade among developing countries grew at a slower rate than their trade with the developed nations, but between the 1970's and 1980's this trend was encouragingly reversed. 3 Trade among the South Asian countries over the last decade has, however, not shown much buoyancy; in fact, for many years it has remained stagnant. Although South Asia (India, Pakistan, Bangladesh, Sri Lanka and Nepal) claim 20 per cent of the world population (about 927.6 millions in mid-1982), its share in the world Gross National Product (GNP) is less than 2 per cent. The Gross Domestic Product (GDP) of the region was around US $ 193 billion in 1982. 4 The region's share in world trade is also meagre; it had been exporting goods worth US $ 14 billion in 1983, which constituted only 0.8 per cent of the world exports, whereas its imports were about US $ 23 billion which represented 1.3 per cent of the world's imports. 5 This indicates that the value of imports was nearly double the value of its exports and hence showed an adverse balance of trade of the order of about US $ 10 billion in 1983. This trade deficit accounted for about 5.2 per cent of its GDP. In spite of the geographical contiguity and proximity of the South Asian region and enormous potential for trade and development, the region remains most backward and has the largest concentration of poverty and low income. The contiguous geographical facilities had never been exploited for the total development of the region. The income level of all countries of South Asia is very low: the per capita GNP varied between $ 140 to $ 380 in 1982 and the per capita growth rate during 1960 to 1982 was also deplorably low. 6 The highest per capita growth rate was shown by Pakistan (2.8%), followed by Sri Lanka (2.6%) and India (1.3%). The per capita growth rate was negative for Nepal (-0.1%) and 0.3% for Bangladesh. The Gross Domestic Investment (GDI) as a percentage of GDP of the countries of the region varied between 14 per cent to 31 per cent, whereas savings as a percentage of GDP varied between −3 per cent to 22 per cent in 1982. 7 India topped the list of savings level −22. per cent—and Bangladesh stood at the bottom with −3 per cent of the GDP. The South Asian countries are predominantly agriculture-based with more than 50 per cent of their labour force engaged in agriculture. While India employs 71 per cent of its labour force in the agricultural sector, the percentages in Bangladesh and Nepal are 73 per cent and 93 per cent respectively. In the case of India and Pakistan about 30 per cent of GDP flows from agriculture whereas its share is the order of 47 per cent and 27 per cent respectively in Bangladesh and Sri Lanka. The gowth of exports exceeds that of imports in India and Pakistan whereas the growth of imports exceeds growth of exports in Bangladesh and Sri Lanka. In the case of India and Pakistan the average annual growth rate of imports was 2.6 per cent and 3.9 per cent respectively in the 1970's, while the average annual growth rate of exports was 4.7 per cent each in the same period. Bangladesh had shown a negative growth rate of 0.8 per cent in exports whereas Sri Lanka had shown a positive growth rate of 0.1 per cent in exports in the 1970's. The high propensity to import, coupled with the obstacles to expand exports, creates a typical situation whereby the exports of most underdeveloped countries lag behind their imports. 8 What has been the relationship between the value of imports and exports to the national income of various countries can be seen below. In 1982, Sri Lanka topped the list of exports (27% of GDP) followed by Nepal (11%), Pakistan (10%), Bangladesh (8%) and India (6%). The structure of exports of these countries indicated that over 32 per cent of exports of India, Pakistan and Bangladesh consist of primary commodities whereas in the case of Sri Lanka and Nepal the share of primary commodities to total exports represents 65 per cent. 9 On the other hand capital and manufactured goods shared 50 per cent of their total imports for all countries except India in which case its share was only 38 per cent in 1981. 10 India exports about 20 per cent of its total exports to developing countries, the rest 80 per cent goes to developed countries. This proportion in the case of Pakistan and Sri Lanka is 37 per cent and 46 per cent respectively. Bangaladesh and Nepal are exceptions since the major portion of their exports—over 50 per cent—is directed to developing countries. Thus it is observed that the South Asian countries' exports to developing countries are at the lowest ebb. This calls for new strategies and policies to boost trade among them. In this context, it will be revealing to analyse in greater detail the trade flows amongst them.

South Asian countries are characterised with varied pattern of FDI inflows, Gross Domestic Product (GDP) and Domestic Investment. It is interesting to have an analysis of these factors for evaluating the impact of FDI on domestic investment and GDP. FDI has an important role in promoting growth by accelerating domestic investment in the host country. Many a times it is observed that FDI in host countries deviate much from the expected role of promotion of domestic investment by displacing domestic investment. South Asia, with an annual average of 6.7 percent increase in real GDP over the past decade, holds the world’s third largest position in terms of GDP. However, South Asia’s FDI inflows as a share of GDP is observed to be the lowest among all developing regions. A detailed analysis is performed with the help of methodology used by Agosin and Mayor (2000) to measure the impact of FDI in this paper. The beneficial/harmful effect of FDI are termed as crowding in/out effects. For this purpose, panel data analysis is performed for the years ranging from 2003 to 2013. The World Bank data of 2005 base year is put to use. Three variables such as FDI inflows to GDP ratio, Growth of Gross Domestic Product (GDP) and Domestic Investment (DINV) are considered for Seemingly Unrelated time series analysis for India and for the Seemingly Unrelated panel data analysis for South Asian countries. The results obtained highlight important findings with regard to FDI in bringing about crowding in and crowding out impacts of FDI. It also brought to light the compatibility between domestic investment and Foreign Direct Investment in India and South Asia. The SUR results for the entire South Asian region indicate Crowding Out effect of FDI Inflows as it can be observed from the β LT value which is −7.023. This implies that additional one dollar of FDI displaces roughly seven dollars of domestic investment from the South Asian countries. The SUR time series analysis performed individually for India indicates that India too shows mild crowding out impact of FDI in its economy. In the past decade, though South Asia witnessed an increase in FDI inflows, it resulted in the displacement of domestic investment, which is a great cause of worry. FDI policies have to be instrumental in preventing the entry of harmful type of FDI inflows and in promoting the entry of the right type of FDI into South Asia.

Foreign Direct Investmentplays a crucial role in the economy of developing countries like Bangladesh through accelerating Gross Domestic Product (GDP), export and domestic investment followed by overall economic growth. The present scenario of FDI in Bangladesh in not still satisfactory enough but given the availability of abundant resources, skilled and cheap labor forces, a stable political atmosphere, effective monetary and fiscal policy, improvement of infrastructure and long term strategic planning to stimulate FDI might be able to make the condition favorable to attract foreign investment in Bangladesh. South Asian countries need to improve their domestic investment, exports and infrastructure facilities, along with more foreign investment, to achieve higher growth. This report analysis of FDI flows to south Asian countries reveals that there has been an increasing trend of FDI into South Asian countries. Findings analysis suggest that FDI has a positive impact on export growth through its positive spillovers for South Asian countriesFDI in South Asia is mostly concentrated in manufacturing and services. Despite some policies reforms, Bangladesh could not attract handsome flow of FDI as yet. Furthermore, the lion’s share of FDI is being repatriated. The main focus of this paper is to reveal how attractive the position of Bangladesh in south Asian countries. We find from the report that Bangladesh hold the second position in FDI but not in attractive position. The paper also analyses the problems and prospects of FDI in Bangladesh. The study also provides some remedies to solve the problems.

PurposeThe purpose of the paper is to empirically examine the relationship between energy consumption and economic growth for a panel of five South Asian economies, namely, India, Pakistan, Bangladesh, Sri Lanka and Nepal over the period from 1971 to 2010 within a multivariate framework.Design/methodology/approachThe study uses Pedroni cointegration and Granger causality test based on panel vector error correction model to examine long-run equilibrium relationship and direction of causation in the short and long run between energy consumption and economic growth using energy inclusive Cobb–Douglas production function for a panel of five South Asia countries, namely India, Pakistan, Bangladesh, Sri Lanka and Nepal.FindingsPedroni’s panel cointegration test indicates the long-run equilibrium relationship between economic growth per capita, energy consumption per capita and real gross fixed capital formation per capita for panel. Further, 1 per cent increase in energy consumption per capita increases the gross domestic product (GDP) per capita by 0.8424 per cent for the panel. Causality results suggest bidirectional causality between energy consumption per capita, gross fixed capital formation per capita and GDP per capita in the long run and unidirectional causality running from energy consumption per capita and gross fixed capital formation per capita to GDP per capita in the short run.Practical implicationsThese South Asian countries should implement an expansionary energy policies through improving the energy infrastructure, energy efficiency measures and exploiting massive renewables’ availability for low-cost, affordable clean energy access for all, especially in the yet unserved rural and remote areas for further stimulating economic growth.Originality/valueImplementing energy efficiency measures and massive renewables development (wind, solar and hydropower) may help the affordable and clean energy access and reducing fossils fuel dependence and its associated greenhouse emissions in South Asia.

Impact of COVID-19 on Various Sectors of the Economy

Economic development is a most imperative element in figuring out the well-being of the citizens in a country. The present study analyzes the effect of key macroeconomic indicators on the Economic development of South Asian countries. The study intends to scrutinize the long-run and short-run association between Economic development and several macroeconomic variables by using panel data analysis. During ultimate 10 years, a few South Asian countries (SA) had economic instability. The study is aimed to investigate the macroeconomic indicators of some selected SA countries’ economic growth. The static linear panel statistics model had been used for figuring out the consequences of unbiased macroeconomic variables on the gross domestic product (GDP) of SA member countries including Bangladesh, India, Pakistan, and Nepal. While explained variable of examines is analysis is gross domestic product (quantity), the unbiased variables are current account balance general government gross debt, general government revenue, general government total expenditure, inflation (average consumer prices), population, the volume of exports of goods and services, volume of imports of goods and services. The analysis proposed is grounded on a panel data (cross-sectional time series data) approach. The data set of this exploration involves four SA members among 9 countries (cross-sectional units). The effects of 8 macroeconomic indicators on gross domestic product volume were examined. The paper also empirically analyzes the (negative impacts of the global financial crisis) on four SA countries’ economic growth during the 1980 – 2020 periods (time series). In this environment, the goods of macroeconomic parameters are anatomized using panel data series. The main findings of this model indicate that the level of population, general government revenue, inflation (average consumer prices), and volume of exports of goods and services, positively affects economic growth. The findings of this paper will be used for increasing the economic growth of south Asian countries.

Economic development is a most imperative element in figuring out the well-being of the citizens in a country. The present study analyzes the effect of key macroeconomic indicators on the Economic development of South Asian countries. The study intends to scrutinize the long-run and short-run association between Economic development and several macroeconomic variables by using panel data analysis. During ultimate 10 years, a few South Asian countries (SA) had economic instability. The study is aimed to investigate the macroeconomic indicators of some selected SA countries’ economic growth. The static linear panel statistics model had been used for figuring out the consequences of unbiased macroeconomic variables on the gross domestic product (GDP) of SA member countries including Bangladesh, India, Pakistan, and Nepal. While explained variable of examines is analysis is gross domestic product (quantity), the unbiased variables are current account balance general government gross debt, general government revenue, general government total expenditure, inflation (average consumer prices), population, the volume of exports of goods and services, volume of imports of goods and services. The analysis proposed is grounded on a panel data (cross-sectional time series data) approach. The data set of this exploration involves four SA members among 9 countries (cross-sectional units). The effects of 8 macroeconomic indicators on gross domestic product volume were examined. The paper also empirically analyzes the (negative impacts of the global financial crisis) on four SA countries’ economic growth during the 1980 – 2020 periods (time series). In this environment, the goods of macroeconomic parameters are anatomized using panel data series. The main findings of this model indicate that the level of population, general government revenue, inflation (average consumer prices), and volume of exports of goods and services, positively affects economic growth. The findings of this paper will be used for increasing the economic growth of south Asian countries.

Can we live within environmental limits and still reduce poverty? Degrowth or decoupling?

Assessing the economic impact of public investment in Malaysia: a case study on MyRapid Transit project using a dynamic computable general equilibrium model

This paper initially examines the level of development and the rate of economic growth in South Asian countries. Subsequently attention is shifted to examine how far economic growth has contributed to social justice. The level of development is examined conventionally in terms of relative per capita incomes, while the rate of economic growth is examined in terms of annual compound growth rate in real gross domestic product (GDP). For evaluating social justice several indices are used—relative income inequality, distribution of assets, proportion of population below the poverty line, and real earnings of agricultural labourers. Having consolidated the available literature on the subject, a search for their consistency is attempted and interpretations offered. The final section thus examines the evidence with respect to causation of inequality and offers policy guidelines. While the focus of the paper is the South Asian countries, illustrations from the experience of South East Asian countries is also drawn for comparison.

The causative factors of environmental degradation in South Asia

As is well-known, the seminal work of the late Angus Maddison has established that 2,000 years ago the Indian subcontinent (modern day, South Asia) and China were by far the richest regions of the world. Since the Industrial Revolution of the nineteenth century, the share of world GDP of the Indian subcontinent had started to decline. This trend reversed somewhat after the economic reforms of the 1980s and 1990s. More recently, however, economic growth in South Asia has softened yet once again for several reasons. This book focuses on the slowing pace of economic reforms and outlines a two-pronged strategy to jumpstart South Asian economies. First, South Asian countries should complete the economic reform process that they had begun in the 1980s and 1990s and implement the more microeconomic reforms, namely, the sectoral, and governance and institutional reforms to enhance competition and improve the operation of markets. Second, they should implement the second round of ‘Look East’ policies or LEP2 to (i) link themselves to production networks in East Asia, their fastest-growing markets, and (ii) develop production networks in manufacturing and services within their region. The book argues that the proposed strategy will lead to a win-win situation for all countries in South Asia and East Asia and reinvigorate economic integration within South Asia, one of the least integrated regions of the world. The book also identifies the unfinished policy reform agenda for each South Asian country and the components of the LEP2 that they should implement.

This study examines the relationship among energy use, real gross domestic product, and exports and thereby the impact of energy conservation for the quest of a sustainable environment-gross domestic product growth in the panel of five South Asian countries. The aggregate production function framework is estimated by employing first/second generational panel co-integration-based models for the panel data covering the years 1980–2014. The empirical findings demonstrate a statistically significant panel error correction mechanism among real gross domestic product, capital, labor, and energy use in both export-added and export-excluded models. The findings of panel causality test depict a significant causal relationship running from export and energy use towards gross domestic product in the long run. Furthermore, a significant feedback relationship between energy use and gross domestic product and between exports and gross domestic product has been found in the short run. These findings of vector error correction model-based panel causality test imply that reducing/cutting the extant aggregate energy use (fossil fuel dominant) via conservation policies are somewhat wanting and could be implemented at the cost of lower gross domestic product and export growths, ceteris paribus. Therefore, for reducing the level of carbon emissions arising from fossil fuel-based energy use and for a sustainable aggregate energy use to the production sector per se, there is an immense need of developing environment friendly/green sources of energy in the region. These consolidated and concerted strides of developing and substituting environment friendly energy options into the extant aggregate energy use will, inter alia, ensure the sustainability of environment-gross domestic product growth in South Asia.

The burgeoning conflict over the water sharing is now a global phenomenon. Many international treaties, laws and water management models are available to settle down the water sharing issues among the states like Absolute Territorial Sovereignty and the Upper Riparian, Absolute Territorial Integrity and the Lower Riparian and Mediated Strategy of Restricted Integrity. Inter-provincial water sharing issue in Pakistan is a classic example of upstream-downstream rivalry which has been traced back from the pre-partition history of Pakistan. Lower riparian province Sindh has a historical conflict with upper riparian province Punjab, Balochistan being lower riparian has water conflicts with Sindh, and KPK has water sharing issue with Punjab. The constitution has also empowered the existing institutions like CCI and IRSA and established several new rules for the water manageme among provinces. Currently, it has become the issue of federation and has disturbed the provincial harmony and national integration.

The aim of this article is to investigate the relationship between gross domestic product (GDP) growth rate, inflow foreign direct investment (FDI), trade openness, and unemployment in five South Asian countries between 1998 and 2017 using a vector autoregressive model. It has been empirically found that GDP growth rate and unemployment have positive relationships with FDI. Results demonstrated that there is a directional relationship running from FDI to GDP growth rate and from FDI to unemployment. The study shows that there is a long-run relationship between GDP growth rate, FDI, trade openness’s and unemployment in the region. Macro policies are recommended to accelerate economic growth, FDI, and reduce unemployment rate in South Asia.